INDUSTRY BRIEFS

ENVIRONMENT

U.S. FEDERAL COURT

in Billings, Mont., ordered Balco Inc., Williston, N.D., to pay a $1 million fine for violating federal rules protecting groundwater. The court ordered Balco to stop injecting saltwater at pressures that could cause fractures and contaminate groundwater. The court said during 1988-91 Balco injected wastes without a permit or authorization from the Environmental Protection Agency.

COMPANIES

CHEVRON CORP.,

Mobil Oil Corp., and Shell Oil Co. agreed to pay a combined $65.5 million plus as much as $11.5 million in redeemable vouchers to settle lawsuits brought by California, Arizona, Washington, and Oregon charging them and four other oil companies with conspiracy to fix product prices in the 1960s and 1970s. Settlements were reached earlier with Exxon Corp., ARCO, Unocal Corp., and Texaco Inc. (OGJ, May 4, 1992, p. 56).

TOTAL

will sell its 53% interest in Total Canada Oil & Gas Ltd. - more than 18 million shares - for $9.75 (Canadian)/share in a secondary offering. Closing is to occur Feb. 1. The move is aimed at freeing capital for investment in other upstream projects worldwide. Total Canada produces about 9,000 b/d of liquids and 65 MMcfd of gas and has upstream assets in Alberta, British Columbia, and Saskatchewan.

SANTA FE INTERNATIONAL CORP.

and affiliates plan to consolidate and move to Dallas from Alhambra, Calif. The reorganization will be effective Feb. 1 , and the move is planned for midsummer after an office site is selected. The company has offices in Dallas, employing 125 people there. Santa Fe Pres. Gordon M. Anderson said the Dallas location gives the company access to a larger technical workforce in a climate of better support from state and local governments.

W.R. GRACE & CO.,

Boca Raton, Fla., signed a definitive agreement with an undisclosed company to sell the stock of Grace Petroleum Corp., Oklahoma Co, for $125 million. The deal is to close this quarter. Excluded are Grace Petroleum's East Texas oil and gas assets, which are to be sold to Sonat Exploration Co. for $28 million, and Grace's interest in an undisclosed field.

FOREST OIL CORP.,

Denver, received $51.25 million in settlement of take or pay litigation with Oneok Inc., Tulsa (OGJ, Dec. 28, 1992, p. 26). Forest said the settlement will boost its 1992 fourth quarter earnings before tax and extraordinary items by about $34.5 million.

LOUISIANA LAND & EXPLORATION CO.

plans capital and exploration spending of $170 million in 1993, 15% more than estimated 1992 expenditures. The company expects 1992 additions to oil and gas reserves to exceed production for the year. LL&E estimates its reserve acquisitions cost an average $4/bbl of oil equivalent (BOE) during 1992. Reserve replacement costs from all sources averaged $7/BOE.

OLIVER RESOURCES PLC,

Dublin, made a takeover bid for Kirkland AS, Oslo, after buying 3% of Kirkland's issued share capital. Oliver offered 250 of its shares per Kirkland share, which values Kirkland at 228 million kroner ($32.6 million). Kirkland shareholders' reaction is expected in February, Kirkland said indications of support are good.

DRILLING-PRODUCTION

ALTA ENERGY CORP.,

Avon, Conn., plans this quarter to begin a 42 infill well drilling program in Eddy County, N.M. The company completed a $16 million private financing with institutional lenders enabling it to start the program.

SANTOS LTD.,

Adelaide, paid $177.5 million for the oil and gas assets and oil pipeline interests of AGL Petroleum, Brisbane. The acquisition, effective last Jan. 1 , increased Santos' proved and probable reserves by about 60 million bbl of oil equivalent (BOE) and yearly production by about 3.6 million BOE. Santos plans to retain all AGL employees and will manage the assets through a separate business unit based in Brisbane.

MINERALS MANAGEMENT SERVICE

reported receipts from U.S. production of oil, gas, coal, and other minerals on federal and Indian land in 1991 totaled $3.9 billion, down $700 million from 1990. MMS attributed the drop to reduced production, low prices for oil and gas, and congressional bans on offshore drilling.

PETRO-CANADA

acquired a 32.5% interest in Alberta's East Valhalla oil field in a trade with Crestar Energy Inc., Calgary. The deal boosts Petro-Canada's interest in the field to 96%. Crestar said it gained 1 MMcfd of gas production and 350 b/d of liquids production by taking over Petro-Canada's interest in nearby Wembley Halfway B gas unit, increasing its interest in the unit to 33.7% from 23.4%. Petro-Canada plans a waterflood program to increase net production from Valhalla by 800 b/d to 8,100 b/d.

PETROLEUM DEVELOPMENT CORP.

(PDC), Bridgeport, W.Va., plans to drill 15 wells in North Central West Virginia during this quarter. The 3,000-5,500 ft wells will mainly target natural gas. Capital for the program is being provided by the PDC 1993-A partnership, formed last Dec. 31 with $3.3 million. PDC drilled 81 wells in West Virginia during 1992, an increase of 52% from 1991. The company retained a 20% interest in all wells drilled in 1991-92 and plans to retain similar a interest in the 1993 wells.

COLUMBIA GAS DEVELOPMENT CORP.,

Houston, plans to develop two Gulf Coast discoveries. The 1 Arco Fee in Jasper County, Tex., flowed 396 b/d of oil and 237 Mcfd of gas through a 11/64 in. choke with 870 psi flowing tubing pressure from Tertiary Wilcox. Total depth is 9,200 ft. The 1 Alexander Motty in Vermilion Parish, La., flowed 345 b/d of oil and 38 Mcfd of gas through a 11/64 in. choke at 1,630 psi.

EBCO U.S.A. INC.,

Dallas, will offer 725 oil and gas leases at a no minimum bid sale Feb. 3-4 in Dallas. Leases in Texas, Louisiana, Alabama, Michigan, and Mississippi will be offered the first day, and leases in Oklahoma, New Mexico, Kansas, Colorado, Arkansas, California, Montana, North Dakota, South Dakota, and Wyoming will be available the second day.

MAERSK VIKING JACK UP

is operated by Maersk Drilling, Copenhagen, not Saipem SpA, as incorrectly reported (OGJ, Jan. 4, p. 19).

REFINING

PETROLEOS MEXICANOS

let contract to UOP for technology and basic engineering for revamp of the 15,000 b/d naphtha reforming unit at its 195,000 b/ d Ciudad Madero, Mexico, refinery. The continuous catalyst regeneration Platforming unit will process 20,000 b/d of straight run naphtha. Low reactor pressure will allow the unit to produce the highest commercially demonstrated yields.

KERR-MCGEE CORP.

expected to start a planned turnaround for repairs and maintenance at its 104,000 b/d Corpus Christi refinery in mid-January, cutting production to about 65,000 b/d until the end of February when all units are to be fully operational. The company plans a turnaround of the hydrocracker at its 43,000 b/d Wynnewood, Okla., refinery in late February. Crude runs will be maintained during that operation. Arrangements have been made to meet product sales obligations.

EXPLORATION

TRINIDAD AND TOBAGO

awarded petroleum exploration rights to Unocal Trinidad Ltd. covering the 486 sq mile Block 89/3 about 45 miles off the east coast of Trinidad (see map, OGJ, Nov. 20, 1989, p. 29). Unocal will spend at least $22 million to explore the block the first 3 years, drilling three wells and acquiring 3D seismic data. The first seismic program is to begin soon, and the first well is to be drilled in 1994. Unocal holds a 100% interest in the block, which is in water that averages 300 ft deep.

MALTA

awarded an exploration and production sharing contract covering the 1,340 sq km Block VII off southern Malta to Shell Malta Exploration BY and Nimir Petroleum Co. Malta Ltd. in a 50-50 partnership. The frontier block is in water depths to 1,300 ft. Shell will carry out an initial exploration program that will include 3-D seismic surveys. Bidding for the seismic contract has begun, and data acquisition is to start this quarter.

FOREST OIL

and W&T Offshore Inc., Houston, will team up to drill six wildcats by yearend on the Outer Continental Shelf of the Gulf of Mexico on leases held by Forest. Forest will provide and manage technical resources, while W&T will operate and provide capital for the venture. The companies also plan to develop prospects on acreage available at federal and state lease sales.

MMS

asked the U.S. petroleum industry to indicate interest in exploring three regions off Alaska. MMS has scheduled lease sales in the Beaufort Sea in 1995, Chukchi Sea in 1996, and Hope basin in 1997.

THE CANADIAN GOVERNMENT

called for nominations for exploration rights in the Beaufort Sea and Mackenzie Delta. Size of the area was not disclosed, but it includes acreage under license that may revert to the government before Apr. 5, closing date for nominations. An offering of rights on part of the nominated land is to begin May 3. The land include part of the western Beaufort Sea, claimed by both Canada and the U.S. Exploration is prohibited in this area, but companies can bid for land rights.

PETROCHEMICALS

NATIONAL METHANOL CO.,

a Saudi Basic Industries Corp. (Sabic) unit, claimed a world record for methanol production from a single unit. On Dec. 14, production for 1992 passed 1 million metric tons. The company is building a 700,000 metric ton/year methyl tertiary butyl ether plant, scheduled for start-up in first quarter 1994 (OGJ, Aug. 17, 1992, p. 46).

SABIC

named Bechtel Ltd., London, managing contractor for a 140,000 metric ton/year polyester project in Yanbu. The plant is scheduled to go on stream in 1995.

GOVERNMENT

PHILIPPINES

President Fidel Ramos approved a plan to privatize the government's energy companies and deregulate the oil industry. The plan includes offering to domestic and foreign investors 65% of state owned Petron Corp., which had assets of $873 million as of December 1991 and net income of $47.3 million for the year. Petron holds a 40.7% share of the domestic petroleum products market and has refining capacity of 155,000 b/d. The privatization plan is a reaction to the country's prolonged power shortages, which last 3-4 hr every day in Luzon and about 8 hr/day in Mindanao.

BUREAU OF LAND MANAGEMENT

extended for 3 years the $1/acre rental policy for certain U.S. onshore leases issued before Mar. 1, 1993. Since 1986, BLM has permitted the reduced rental, which otherwise would be $3/acre, to forestall lease abandonments at a time of low oil and gas prices.

DEPARTMENT OF ENERGY

established a computer bulletin board to provide the public with information on U.S. gas import and-export authorizations. The bulletin board later will be expanded to include historical regulatory actions of the Office of Fuels Programs. The bulletin board can be accessed via computer modem at 202-586-6496.

TRANSPORTATION

IRAQ

said the rebuilt southern ports of Khor Al-Zubair, with 21 piers, and Umm Qasr, with two terminals, are back on stream, OPEC News Agency (Opecna) reported. The Al-Bakr terminal on the northern tip of the Persian Gulf was returned to service last August at a cost of about $16 million (OGJ, Sept. 7, 1992, p. 22) and is restored to full loading capacity of 1.6 million b/d. Opecna reported the Khour Al-Omayyeh port, also at the northern end of the gulf, is to be restored as well.

IRAN

early this month started up a 100,000 b/d crude oil pipeline that connects the port city of Bandar Abbas with Kerman province to the north. From Kerman the line extends to Central Isfahan province, where it connects with the nationwide pipeline network. Another pipeline, that will augment supplies to Zanjan province in the northwest, also was commissioned early this month. Last year oil shortages led to sharp criticism from the public because Iran is one of the world's major oil exporters.

CITRUS INDUSTRIAL SALES CO. INC.,

a joint venture of Sonat Inc., Birmingham, Ala., and Enron Corp., Houston, agreed to supply as much as 100 MMcfd of firm natural gas to Florida Power & Light Co. under a 15 year agreement. The accord takes effect with start-up of Florida Gas Transmission Co.'s Phase III expansion, scheduled for completion in November 1994. Florida Gas is holding an open season for capacity on its Phase IV expansion (OGJ, Jan. 11, p. 25).

SOUTHERN CALIFORNIA GAS CO.

(SCG) let contract to Norton Chemical Process Products Corp. for four NOx removal systems for its Wheeler Ridge pipeline gas compressor station. The systems will enable SCG to meet stringent emissions standards in Kern County, Calif. This is the first application of gas turbine selective catalytic reduction to eliminate turbine water injection to control NOx.

SPILLS

U.S. ENVIRONMENTAL PROTECTION AGENCY

suspended for 3 years a requirement that states treat substances created during oil spill cleanups as hazardous wastes. The suspension will apply only in states that certify to EPA they have programs and powers to require such cleanups. In the meantime, EPA will consider changing its rules.